Average Up

AAA

DEFINITION of 'Average Up'

The process of buying additional shares at higher prices. This raises the average price that the investor pays for all the shares. In the context of short selling, averaging up is achieved by selling additional shares at a price higher than that of the first transaction.

INVESTOPEDIA EXPLAINS 'Average Up'

Say you buy XYZ at $20 per share, and as the stock rises you buy equal amounts at $24, $28 and $32 per share. This would bring your average purchase price to $26 per share.

RELATED TERMS
  1. Short Selling

    The sale of a security that is not owned by the seller, or that ...
  2. Average Down

    The process of buying additional shares in a company at lower ...
  3. Dollar-Cost Averaging - DCA

    The technique of buying a fixed dollar amount of a particular ...
  4. Adding To A Loser

    The action of a trader/investor increasing a position in an asset when its ...
  5. Scale Out

    The process of selling portions of total held shares while the ...
  6. Bidder

    The party offering to buy an asset from a seller at a specific ...
Related Articles
  1. Trading The MACD Divergence
    Forex Education

    Trading The MACD Divergence

  2. Take Advantage Of Dollar-Cost Averaging
    Insurance

    Take Advantage Of Dollar-Cost Averaging

  3. If I own stock that drops in price is ...
    Investing

    If I own stock that drops in price is ...

  4. War's Influence On Wall Street
    Bonds & Fixed Income

    War's Influence On Wall Street

comments powered by Disqus
Hot Definitions
  1. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  2. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  3. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  4. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  5. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  6. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
Trading Center